The Kansai Electric Power Co., Inc. (KEPCO) and Mitsubishi Materials Corporation (MMC) have been jointly developing disc-type intermediate temperature solid oxide fuel cells (IT-SOFCs) since 2001. Operation temperatures between 600 and 800 degrees C have been set as the target. These temperatures enable SOFCs to use inexpensive metallic separators for cell-stacking and are sufficiently high for steam reforming of the hydrocarbon fuel. A I kW-class demonstration power generation system with a module that had a steam-reforming function was developed in 2003. The third generation module and the fourth generation module were developed in 2004. The third generation module was integrated into the system for various tests including long-term stability. The fourth generation module was examined for performance evaluation. The system included an SOFC module, a dc-ac inverter, a desulfurizer, a heat-recovery unit, and an automatic control device. The long-term stability test for over 1000 h gave no decrease in stack voltage. In parallel, the long-term stability test of a single cell stack unit was continued for over 10,000 It. In addition, hot water at 90 degrees C was obtained by the heat-recovery unit using high temperatures off-gas from the SOFC module. The newly developed fourth generation module gave an electrical efficiency of 60% (dc/lower heating value) using town gas as a fuel at an average stack temperatures of about 750 degrees C. A 10 kW-class SOFC co-generation system has been under development in a New Energy and Industrial Technology Development Organization project since 2004. (c) 2006 Elsevier B.V. All rights reserved.